EURUSD Continues on Range bound MovementThe pair continues to be in range ahead of the FOMC next week
EURUSD continued to move on a range bound track during Thursday’ session, while early the pair saw slight bearish momentum post US market hours as US dollar was slightly influenced by positive Philadelphia Fed Manufacturing index ratings. The hourly trading charts show that EUR has been on a bearish momentum during today’s morning trading session. However the price range is still within expected short term price band which can hence be viewed as range bound pattern. While the short term market trend does seem in USD’s favor EURO still continues to remains strong and this is evident when we take a look at price range in last three months.
EURUSD Continues in Range
Most traders are cautiously awaiting FOMC minutes and in trading session to come, short term interest rates in US continue to rise ahead of US Fed Rate hike and this is expected to support the greenback. Also US Ten year bond yields are now up 5 bps to 2.92% and are expected to continue seeing further increase which is also expected to strongly support greenback to gain bull momentum across basket of major currencies. EURO faces further pressure in short term as the Euro zone inflation remains well below central bank’s target of 2%.
Even if there is a breakout in this range bound momentum post a possible signal from ECB’s monetary policy next week, the price range will still be within longer price band that existed in the last three months (i.e., 1.209 & 1.259) as EURO continues to face strong support from positive economic environment as the 19 countries that share the euro are now enjoying the strongest growth in a decade after years of economic crisis that almost unraveled the euro zone. For EURO to see another bullish breakout or gain another boost in value against USD in days to come EU policymakers should soon work out reforms to resolve any possible weakness in economy while there is still momentum in current economic growth. In short term trading, support & resistance for EUR continue to be around range of 1.221 & 1.247 respectively.